India – Draft safe harbour rules released

With a view to reduce the number of transfer pricing audits and prolonged disputes in matters relating to comparability analysis under transfer pricing, the Indian Finance (No.2) Act, 2009 inserted a section 92CB in the Indian Income-tax Act, 1961 (the Act) for notifying safe harbour rules. Since then, the taxpayers have been anxiously waiting for these rules and finally the Central Board of Direct Taxes (CBDT) has released the safe harbour rules in a draft form. Such efforts are in line with those of the OECD in attempting to introduce bilateral safe harbour provisions between sovereign countries.